Models and Partnerships for Social Prosperity
Re-thinking Neighbourhood Planning From consultation to collaboration
A ResPublica Green Paper Dr Patricia Kaszynska, James Parkinson and Will Fox
In association with:
About ResPublica ResPublica is an independent, non-partisan UK think tank founded by Phillip Blond in November 2009. In July 2011, the ResPublica Trust was established as a not-for-profit entity which oversees all of ResPublica’s domestic work. We focus on developing practical solutions to enduring socio-economic and cultural problems of our time, such as poverty, asset inequality, family and social breakdown, and environmental degradation.
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Contents 1 Introduction
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2 Neighbourhood planning and meaningful community-led planning
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3 Capturing Social Value
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4 From consultation to collaboration: Shared decision-making for shared benefit
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4.1. Capturing social value through a ‘Neighbourhood Partnership Agreement’
4.2. Neighbourhood Partnerships as mechanisms to leverage funding
5 On the horizon: Taking Neighbourhood Planning to the next level
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6 Conclusion
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7 Recommendations
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Introduction
The passage of the Localism Act marked a significant transfer of power away from Whitehall into the hands of local authorities and local communities. This devolution of decision-making and promotion of civic activism will provide greater opportunities for communities to mobilise local resources and through new neighbourhood planning powers, help re-shape our towns and cities from the bottom-up. The introduction of neighbourhood planning has the potential to rethink the way we plan and design. It can help us develop our understanding of community participation within the design process; one which moves away from meaningless tick-box consultation exercises to one which is underpinned by a genuine and meaningful partnership between local authorities, communities, developers and professionals: real community-led planning. By moving beyond existing practices, which are broadly consultative in nature, these partnerships can have long-term mutual benefits and demonstrable social impact. By designing with, rather than for, communities, neighbourhood planning can lead to more appropriate and successful local planning and help create better places. But this kind of collaboration within the planning process – if done in a comprehensive and meaningful way – can also help create stronger, more cohesive communities, generating social capital through an improved sense of collective agency. For these reasons, as localism moves from the floor of the House of Commons to the floor of the community centre, we should consider how initiatives such as neighbourhood planning can and should be supported in order to maximise its full potential. For neighbourhood planning and indeed the localism agenda - to produce the best outcomes, there is a need for structures to be in place to enable meaningful community engagement in the design and planning process. Within this paper, we examine the support currently available for meaningful community-led planning and make the case for a more sustainable means of providing the resources required to make the process work. In this context, we stress a need to consider the long-term social impacts of successful place-making and participation in the planning process and argue that meaningful community participation in neighbourhood planning can generate social capital. We suggest that these positive social outcomes should be captured in terms of public savings on costs associated with anti-social behaviour and community fragmentation. This capture of social value should be incentive enough to invest appropriately in neighbourhood planning as a preventative intervention that can be integral to community regeneration, both physical and social. We outline the benefits of accounting for and capturing the benefits of social value as a long-term priority, but also recognise the need for alternative, short-term solutions that can make a more immediate difference and explore how a true partnership approach involving multiple stakeholders could be a driver for new models of investment. Furthermore, we demonstrate how neighbourhood planning could provide a platform for more robust forms of local control and community empowerment, by producing organised community structures capable of asset ownership and management. The ambition of this paper is to prompt a radical re-think of how community-led development is understood by policy-makers, arguing for a more holistic approach to planning, which reflects the true social and economic value of building a better built environment and strong communities. The legislative process is over and localism is beginning to be put into practice. Much like our local communities, we need to ensure we plan for the future. Only through strong, up-front backing, can long-term goals be achieved.
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Neighbourhood planning and meaningful community-led planning
What is neighbourhood planning? Neighbourhood planning provides local communities with the opportunity to develop a plan for their area and with it, take greater control over the nature of development and give neighbourhoods the capacity to shape the identity of the places they live, work and play. The new powers introduced through the Localism Act will allow a neighbourhood to decide where new developments should be located, what they should look like and grant planning permission for the developments they want to see go ahead.1 Neighbourhood plans can be created by town and parish councils and in areas where no town or parish councils exist, a Neighbourhood Forum (which must consist of 21 people who live, work or are elected councillors locally) can be created to steer a plan. The exact boundaries of any given neighbourhood are subject to public agreement with the local authority and the plans will be subject to a public consultation process. Plans will be submitted for independent examination and if judged to be in conformity with national policy and the strategic objectives set out by the local authority, will be put to a local referendum. If more than 50 per cent of people voting in the referendum support the plan or order, then the local planning authority must bring it into force. Once in place, these plans will comprise the framework for change in that area for the next ten years.2 ‘Meaningful’ engagement: making neighbourhood planning work Placing local communities – via Neighbourhood Forums - at the heart of the planning process can increase civic pride and social participation and lead to more appropriate and informed design solutions that are more sympathetic to local needs and concerns. Feedback from the New Deal for Communities (NDC) programme reinforces this, concluding that ‘some of the most successful projects […] are those where we have engaged residents in the design process; and some of our least successful projects, including some of the disasters, have been the ones where we haven’t.’3 It is becoming well understood that giving people a stake and a say over what their environment should look like as well as how it works is likely to lead to improved wellbeing of residents. However, planning is complex and for community-led planning to be a success, the process of engagement must be meaningful – one that avoids frustration between potentially conflicting parties and ‘consultation fatigue’; the all too common scenario where communities believe that they have been manipulated and consequently, feel powerless or fail to see any impact of their contributions to the process. This can lead to communities losing both interest and trust in the process; two elements which are crucial to its success. Communities have all too often been involved in token consultation, rather than real engagement in a collaborative planning process which gives them a decision-making capability from the beginning, rather than a reactive one after plans have been made by others. For this to happen, community groups need access to professional support and expertise to ensure that Neighbourhood Forums are able to produce considered, appropriate and robust Neighbourhood Plans. This will ensure a sound process with minimal frustration in which a community group is properly briefed and informed and therefore able to better understand how planning and design decisions are made and arbitrated, and what the consequences of these decisions are likely to be. In the best cases, a two-way learning relationship will be established in which capacity is built within local communities around issues of planning and design, whilst professionals better understand the needs of the people they are designing with and can enable a truly local, yet robust, design response. Indeed, this process will also demand a new role for the professionals involved within the process, who will have to adapt and understand the limitations of this role in a process that is being led by local people; the Neighbourhood Forum.4 Support currently available for neighbourhood planning To ensure that neighbourhood planning is truly meaningful and produces the best outcomes – both in helping improve the quality of the local built environment and creating a sense of collective agency - structures must be put in place to provide Neighbourhood Forums with the necessary resources, expertise and support.
1 Department for Communities and Local Government (2011) An introduction to neighbourhood planning [Online] (Updated 13 October 2011) Available at: http://www.communities. gov.uk/documents/planningandbuilding/pdf/1985896.pdf [Accessed 16 April 2012]. 2 Ibid. 3 Department for Communities and Local Government (2010) What works in neighbourhood-level regeneration? The views of key stakeholders in the New Deal for Communities Programme [Online] (Updated 11 February 2010) Available at: http://www.communities.gov.uk/documents/communities/pdf/1462971.pdf [Accessed 16 April 2012]. 4 The RIBA has explored the role that architects could play within the following publication: RIBA (2012) Guide to Localism – Part 2 – Getting Community Engagement Right [Online] Available at: http://www.architecture.com/TheRIBA/AboutUs/InfluencingPolicy/Localism/Supportingtheprofession.aspx [Accessed 20 April 2012].
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The Government has pledged to provide some funding to support neighbourhood planning. Thus far, this has been distributed via three main delivery channels: • a government-funded pilot scheme awarding grants up to £20,000 for 200 front runners of neighbourhood planning – much of which thus far has been earmarked for advice on legal / planning issues, necessary local authority administration and the final referendum; • £50 million support for local councils; • the ‘Supporting Communities and Neighbourhoods in Planning’ programme projected to release approximately £3m for each year of the four years to four community support organisations which support communities in planning for their neighbourhood. As part of this scheme, £3.2m has been already allocated during 2011/12 to the four participating organisations.5 Additional sources of funding include the following: • Organisations have identified funding, such as Design Council CABE which has also launched a Neighbourhood Projects Small Grants Programme with support from DCLG, although they are not part of the ‘Supporting Communities and Neighbourhoods in Planning’ programme.6 • The Community First programme delivered by the Community Development Foundation (£80 million government-funded initiative with £30 million ring-fenced for Neighbourhood Matched Fund Programme for most deprived communities)7 • Big Local is The Big Lottery Fund’s programme for investing up to £200 million in 150 underfunded urban and rural neighbourhoods in England8 Aside from direct seed funding, the Government has gestured at some possible long-term solutions, such as the use of locally specific extra income raised through the New Homes Bonus and/or the retention of business rates by Local Authorities, with the possibility of a proportion of the receipts being earmarked to support neighbourhood forums. Similarly, there is scope for funding to be sourced from the private sector through mechanisms such as the Community Infrastructure Levy (CIL), a tariff on development to fund local infrastructure and community initiatives.9 However, in its current incarnation, CIL cannot provide funding up-front to secure community involvement at the pre-application planning stage, as it is only paid once the development permission has been granted. Further complications revolve around the clarity of what proportion of CIL money should be invested in community initiatives and, given the widened scope of CIL - stretching from the maintenance of existing infrastructure to the funding of new projects - there is a problem of diluting the levy too far; spreading the funds too thinly over a range of problems. The Government should therefore clarify the proportion of CIL that should be dedicated to community initiatives, either through guidance or by setting out a minimum level. Indisputably, government funding channelled through both community grants and support for community organisations have helped to kick-start community engagement in neighbourhood planning. However, assessments of the future avenues of funding for neighbourhood planning reveal some uncertainty. Whilst the New Homes Bonus, CIL and local business rates have the potential to fund the process, there are no plans to enforce any ring-fencing of this funding for these purposes. Given the severe budgetary constraints faced by many councils, the discretionary character of possible agreements make it seem likely that other investments will have priority over providing the support required to make neighbourhood planning work. Current funding streams are fragmented and disjointed, and do not guarantee stability nor provide a long-term strategic vision for coordinated community resourcing. Jump-starting the process by providing seed funding is a good idea, however a more lasting delivery structure is needed that reflects the co-operative nature of neighbourhood planning and the true long-term social and economic value that it could bring. In the chapters that follow, we reflect upon the potential to capture this value and outline methods of funding that would lock in the commitment of all participating stakeholders to reflect the soft-contract that binds all those involved in meaningful community-led planning.
5 The Building Community Consortium led by Locality in partnership with Glass House Community Led Design, the Eden Project and communityplanning.net was initially a recipient of a £814,000 grant. The Prince’s Foundation who have a long history of successful projects based on the principles of community engagement were granted £800,000 under the terms of the programme. Royal Town Planning Institute’s nine regional offices across England received an initial grant of £1m after their Planning Aid England Scheme (worth £4.5m the previous year) was scrapped in April 2011. National Association of Local Councils in partnership with the Campaign to Protect Rural England were allocated £620,000. 6 The Programme will award grants of up to £7,000 for neighbourhood projects that seek to improve the design quality of the built environment. 7 Community Development Foundation (2012) Neighbourhood Matched Fund [Online] Available at: http://www.cdf.org.uk/content/funding-programmes/community-first/ neighbourhood-matched-fund [Accessed 21 April 2012]. 8 Big Lottery Fund (2012) Big Local Trust: Summary of the programme [Online] (Updated 29 February 2012) Available at: http://www.biglotteryfund.org.uk/prog_biglocaltrust [Accessed 21 April 2012]. 9 Community Infrastructure Levy (CIL) is a charge which local authorities can levy on any new building or extension with a floor area of 100 square metres or more to pay for the local infrastructure needed for new development – schools, community and health facilities, green space, roads. The charge is levied according to a tariff (£x per building) which is set by the local planning authority in consultation with local communities.
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Capturing Social Value
Working with, rather than simply on behalf of, communities on the quality and shape of their local environment could unlock much in the way of social impact and value. Whether urban, rural, affluent, deprived or mixed, different communities will face different challenges, and will in turn seek different methods of engagement. Involving people in the design and shaping of a localised plan (and development) can deliver better outcomes and development that better reflects the community’s needs. The link between a poor quality built environment and poor social outcomes is well established. Bad design has been shown to impact upon educational attainment,10 poor health outcomes and increased levels of crime to name but a few.11 The financial costs caused by poor housing alone - whilst not solely a result of design itself – is estimated at around £7 billion per year.12 This comprises around £1.8 billion related to the costs of crime, £1.4 billion in lost earnings as a result of educational under-achievement and £1.5 billion spent on health related problems when taking into account time taken off work as a result of poor health.13 Investing in and promoting good design therefore must be recognised as a key driver for delivering social value. Neighbourhood planning, underpinned by meaningful participation and engagement, can be an avenue for pre-empting the costly interventions of rectifying unsuccessful development and supporting fractured or deprived communities, but also generate positive social outcomes – social capital – through much improved social cohesion, trust and a sense of common purpose. In addition, this process can discover, harness and develop local skills and resource, building capacity and resilience. The power for certain bodies to capture such value has been increasingly recognised in national legislation and guidance. Recent changes to procurement and commissioning, such as the new Best Value Statutory Guidance14 and the Public Services (Social Value) Act 201215 place an obligation on local and central authorities to consider overall value - including economic, environmental and social value - when reviewing public service provision. This has in turn generated much interest in the measuring of social value and ‘social returns on investment’. Alongside this, the Government has capitalised on socially impactful projects, where the social impact has precise and demonstrable social outcomes. Indeed, the Government has already introduced its first Social Impact Bonds (SIB) pilots: a £5milion project to reduce reoffending among inmates at Peterborough prison sentenced to less than a year and the new £40milion pilot scheme for projects involving problem families in four local authorities: Birmingham, Hammersmith and Fulham, Leicestershire and Westminster. Outside of the pilots other initiatives have commenced – for instance, Liverpool is currently working on the Liverpool Sefton Social Investment Bond which will offer loans from £50,000 to £2 million to social enterprises and community organisations that focus on projects which create jobs, promote economic investment and develop the local area.16 In order to achieve greater social value for communities based on their relationship with private developers, this approach should be extended to the planning process. Meaningful community participation in neighbourhood planning could be synonymous with the idea of preventative early intervention: getting the structures, support and process of community-led planning right will deliver these positive social outcomes. The concept of social value has great potential but there is a need for more robust mechanisms for measuring its impact. Whilst the Government is seeking to explore this through initiatives such as the study commissioned by the Department for Communities and Local Government to measure and create an analytical framework for the benefits of regeneration,17 such frameworks must be greatly expanded in light of the new evidence from neighbourhood planning.
10 Friedman, D. (2010) Social impact of poor housing [Online] (Updated March 2010) Available at: http://www.settledhousing.co.uk/Portals/0/Socialmpactpoorhousing%5B1%5D.pdf [Accessed 2 May 2012]. 11 CABE (2006) The costs of bad design http://s3.amazonaws.com/mission-design-prod/assets/3/The%20cost%20of%20bad%20design_CABE_original.pdf [Accessed 28 April 2012]. 12 Ambrose, P. Davidson, M. Nicol, S. Roys, M. (2010) The real cost of poor housing, Bracknell: IRH BRE Press. 13 Environmental Health News (2011) High cost of poor housing [Online] (Updated 2 September 2011) Available at: http://www.ehn-online.com/news/article.aspx?id=4966 [Accessed 28 April 2012]. 14 Department for Communities and Local Government (2011) Best value statutory guidance [Online] (Updated 2 September 2011) Available at: http://www.communities.gov.uk/ publications/localgovernment/bestvaluestatguidance [Accessed 2 May 2012]. 15 HM Government (2012) Public Services (Social Value) Act [Online] (Updated 8 March 2012) Available at: http://www.legislation.gov.uk/ukpga/2012/3/enacted [Accessed 14 April 2012]. 16 Liverpool Vision (2012) Social Enterprises [Online] Available at: http://www.liverpoolvision.co.uk/Support_for_your_Business/Business_Support/Finance.aspx [Accessed 20 April 2012]. 17 In October 2009, the Department for Communities and Local Government commissioned a study to examine how the benefits of regeneration might be valued to provide an analytical framework for cost-benefit analysis from Department of Communities and Local Government (2010) Valuing the benefits of regeneration [Online] (Updated 13 December 2010) Available at: http://www.communities.gov.uk/documents/regeneration/pdf/1795633.pdf [Accessed 2 April 2012].
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Whilst the body of research cataloguing the costs of bad design nation-wide exists, tentative attempts to put a price-tag specifically on savings generated through community engagement in planning have been treated with suspicion. Attempts to quantify the savings following collaborative planning– for instance as the redevelopment project for the Shoreditch Trust and the project carried out by the Southwark Council18 – are rare. This must change. Identifying and measuring the value of community engagement in neighbourhood planning should not be a unique or isolated case but an example of a wider trend that must be recognised. For developers, local authorities and local communities to invest upfront time and money in a new development, the long term benefits, value and public savings need to be identifiable and measurable. One way to create this evidence base to understand what good design and planning can achieve is to foster a greater understanding of social value capture. Whilst precise metrics may not be achievable in the immediate future, Government should identify the methods and structures required for communities to capture and demonstrate the social value of partnerships and potential projects within the neighbourhood planning process and test them through a front-runner pilot scheme.
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From consultation to collaboration: Shared decision-making for shared benefit
A truly collaborative approach to planning can harness public benefit through social value. However, many past developments claiming to have been designed with input from communities have underachieved in terms of delivering on their initial social aspirations. This is not always due to lack of an engagement processes but through a narrow approach to the very nature of this consultation. Central to a meaningful approach to neighbourhood planning is a decision-making structure which involves a variety of stakeholders, and in which residents have a discernible degree of power. The integrity of this planning process requires a relationship in which communities have access to a professional level of support that can facilitate informed decision-making. In order to make the most of the social impact of neighbourhood planning, we have to move beyond consultation to more robust forms of collaboration.
4.1. Capturing social value through a ‘Neighbourhood Partnership Agreement’ We propose a mechanism to formalise the collaboration process: a ‘Neighbourhood Partnership Agreement’ which would be incorporated within the Neighbourhood Plan. The Neighbourhood Partnership Agreement is a formal agreement between stakeholders such as residents, local businesses, developers, the professional design community and local authorities who will collectively recognise and identify the potential social value for the area as a pre-cursor to the neighbourhood planning process. The social value for a particular project may, for example, include the provision of additional jobs and apprenticeships for those in the near vicinity, if unemployment had been identified by the community as a major issue. Alternatively, or in addition, it may establish the terms in which designs for new development and their consequent impact may be assessed in partnership with the community, addressing further concerns such as health, well-being and criminal activity. The very nature of localism means that projects will be specific to local areas, and communities will have different priorities. The Neighbourhood Partnership Agreement would formalise a process of decision-making in which all those with a stake in the neighbourhood agree upon shared priorities from the outset, a form of brief-making which will establish a clear vision, the terms of engagement and realistic expectations from the outset. Furthermore, the Agreement would also provide the opportunity – at the start of the process – to assess the potential social value that should be assessed through and beyond the neighbourhood planning process, from the value for local economic aspirations, green space or the quality of design. Such a social contract, established between the key stakeholders in the neighbourhood, would recognise the need for accountability and ensure that the voice of neighbourhood forums would not be subjugated either by private sector interests or the local authorities involved. It would also ensure that a sound and meaningful process for community-led planning unfolds.
18 On a £2.2 million housing redevelopment project for the Shoreditch Trust in north London, savings due to community engagement were estimated to be in the region of £500,000. Compared to other projects, there were fewer delays and associated costs caused by responding to residents’ complaints, reworking designs at a late stage to meet user needs, and on-site events such as vandalism and crime. In south London, the award-winning Bellenden Renewal Area benefited from community engagement from the outset. Southwark Council asked residents how they wanted their streets to look and allowed each street to choose designs for its walls, gates, paving and street lighting. More than 60 local artists contributed, including Antony Gormley and Zandra Rhodes, and the once run down backstreets are now one of the most desirable neighbourhoods in the area. House prices are estimated to be 15-20 per cent higher than in surrounding streets. Where whole streets have been improved together, properties are estimated to command premiums of up to 25 per cent.
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An approach that counteracts the suspicion of private partners, such as local businesses and professional advisors, is necessary: all stakeholders need to work fruitfully with communities for mutual benefit. In many areas, residents are most accustomed to working with various public sector representatives, such as housing officials, youth workers, and the police – particularly in inner city areas. A Neighbourhood Partnership Agreement in such areas may seek to also involve representatives from these authorities – all of whom are important facilitators in the process of successful neighbourhood planning. We also recognise that neighbourhood planning should not serve to entrench social divides between communities within an area. The Neighbourhood Partnership Agreement must anticipate that there is often a need for successful collaboration between residents as well as various stakeholder groups, and must therefore indicate where social value is achievable in the interests of those at risk of being marginalised from the process. A Neighbourhood Partnership Agreement would therefore also underscore the need for community capacity-building: that communities need to be enabled to access and harness local expertise and resources as an asset to community-led planning. An example of how this has worked in the past is the CABE enabler model, which provides a channel of support and advice to local communities for which the value of facilitation is disproportionately greater than that of the investment of expert time. Local authorities would be expected to provide a strong strategic vision through their Local Plans and provide advice and support to broker the wider partnership of neighbourhood forums, professional design support and other relevant stakeholders, such as developers. It is likely that some neighbourhood forums will need more support than others, depending on the established social capital and resources immediately available in each area. According to research conducted by Community Matters, the levels of dependence on community organisers and community supporting organisations will be higher in densely populated urban areas.19 This should be expected and understood by local authorities, and indeed used to indicate the variable base lines for measuring value. It should be understood that the more complex and deprived the community, the greater potential there is for transformative impact. Those who have the least are the ones who will benefit most from a collaborative process – as long as they have access to the same opportunities and support. Through the Neighbourhood Partnership Agreement, the community can hold developers, design professionals and others to account by reviewing developments in light of the priorities set out in the clause. But far from being one-sided, the incorporation of a Neighbourhood Partnership Agreement has positive implications for the private sector, in that the planning process thereon is streamlined due to more meaningful early engagement which captures the priorities of the local community. It also accounts for potential capacity from the outset, and paves the way for resource allocation according to these objectives.
4.2. Neighbourhood Partnerships as mechanisms to leverage funding Achieving meaningful partnerships within the planning process requires recognition of the social value gained by adequate structures and financing for the provision of support to communities. This section will look at how we can ensure the integrity of professional expertise through providing the necessary resources for both immediate and long-term benefit to communities. There are a number of models based on the idea that initial investment from professionals will develop the client body into being a smart client. However, this approach does not take into account the wider value of community-led projects. The social impact debate in other sectors has identified the integral gain from effective interventions as relative and transferrable to funding through social finance mechanisms. Developers are already looking at how they could invest in supporting neighbourhood planning. As amenity groups and neighbourhood forums become more powerful and sophisticated, they can often activate networks which have local political leverage. Often engagement and capacity building exercises are funded as preventative tactics to avoid opposition or delay from communities further on in the planning process. But this is to wholly underestimate the true potential of collaborative partnerships within local economies. A truly collaborative neighbourhood partnership can serve as a platform for further local investment. The key point about collaborative partnerships is that they have a local social mandate which is indicative of their financial viability and potential for return on investment. We propose that these partnerships – as captured in the Neighbourhood Partnership Agreement mentioned above – can be used as a special investment platform which brings together monetary as well as emotional commitment from all those involved in the Partnership Agreement, including developers and professionals, public sector groups, local authorities and residents themselves. What we propose is that this funding could also reflect the partnership structures between relevant stakeholders, ‘locking in’ longer term commitment from all parties to achieve a successful and appropriate plan. The exact composition of funding sources will be different depending on whether a developer is involved or not, as well as the extent to which local communities can generate the funding internally – we should note that communities most able to generate funding themselves are also likely to least need support and capacity building. We therefore propose blended investment vehicles, based on hybrid ownership between communities and other stakeholders, including developers, local authorities, crowdsourced funds and local businesses. 19 Community Matters (2010) Commissioning and the Big Society: The role of the community sector [Online] Available at: http://www.communitymatters.org.uk/resources_details. aspx?ResourceId=84&Keyword=big%20society&SubjectID=0&LevelID=0&ResourceTypeID=0&SuggestedUseID=0 [Accessed 14 April 2012]. 20 Department for Communities and Local Government (2011) Pre-application consultation with communities: A basic guide [Online] (Updated 28 February 2011) Available at: http:// www.communities.gov.uk/documents/planningandbuilding/pdf/1854024.pdf [Accessed 16 April 2012].
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Funding sourced from developers – Moving forward from a Community Infrastructure Levy Some forward thinking developers are already choosing to invest in community engagement as a way of both speeding up the process by achieving a higher quality product that fosters some degree of acceptance or civic pride. The Localism Act now makes it compulsory for developers to consult local communities before applying for planning permission for larger developments.20 To augment this we propose a Neighbourhood Consultation Deposit paid up-front on committing to the Neighbourhood Partnership Agreement, and hence a prerequisite to securing planning permission. Each Local Planning Authority should aggregate the deposits within its area and the total sum should be opened up to bids from Neighbourhood Forums, provided they can demonstrate they meet the requirement to match an agreed proportion of funding. This is reminiscent of the current use of the Community Infrastructure Levy (CIL) mentioned earlier. The Localism Act greatly extended the scope of what the CIL money could be spent on; it also suggested that a proportion of this pot has to be spent on community initiatives, thereby opening up the possibility of using it to fund neighbourhood planning. However, it cannot be used at the pre-application stage and not all instances of neighbourhood planning will involve large scale development in the first place. Therefore, developer collaboration in a Neighbourhood Partnership Agreement should be treated as a material consideration in the planning process. The Neighbourhood Deposit would be used for funding the collaborative process which results in an articulated social contract and adds both meaning and material value to the application. Resources from local authorities – Underwriting public budgets As already mentioned, the government committed up to £50 million until March 2015 to ensure that local authorities can fulfil their legal duty to support neighbourhood forums and parish councils with neighbourhood planning. It is increasingly apparent that planning officers will be expected to focus on providing advice and guidance to support the development of neighbourhood plans and the main costs associated with the process for councils will be the legal expenses of organising the referendum needed to approve a plan. Local councils can therefore make a meaningful contribution to neighbourhood planning through providing planning advice and facilitating the prerequisite legal framework. Other public service budgets could also be channelled in part towards the planning process in light of the social impact in other areas. Community Budgets present a way of re-designing local services by integrating delivery in different sectors and bringing together all local spend in the area in order to cut all waste and duplication. As demonstrated in Birmingham’s Total Place programme,21 developing collaborative leadership in the city can only be possible based on detailed financial analysis of spending patterns in individual areas. Yet, the evidence base, in particular for preventative actions, is not readily available. In tandem with the fourteen areas pioneering Community Budgets’,22 a ‘total neighbourhood’ approach could advance the implementation of a single locally controlled and coordinated ‘pool and save’ budget, based on the assessment of potential social value. Evidence gathered by local councils from the neighbourhood planning intervention as part of Total Neighbourhood approach could subsequently prove instrumental in facilitating a move towards a single city budget designed to minimise costs through well-evidenced interventions and preventative actions. In order to capture previous best practice, the Department for Communities and Local Government should facilitate a network of local authorities who have used community budgets, to share experience and evidence. This evidence base should be used to create future economic indicators which can be used to monitor the social impact of neighbourhood planning as part of a ‘total neighbourhood’ approach. Investment from business and residents By virtue of the Neighbourhood Partnership Agreement, successful bids will have significant buy-in from local businesses and residents, which in some cases could be transferred to public commitment in monetary terms. Community funding platforms are increasingly popular given the minimal bureaucracy compared with specialised grant applications. But rather than making donations towards projects on a purely philanthropic basis, residents and local businesses can achieve an ownership stake in projects through investment mechanisms such as share offers. Local businesses, being key economic drivers of local communities, have an interest in the economic uplift and footfall improvements which successful projects – both small scale and larger developments – bring to a neighbourhood. Local businesses therefore may want to invest in these projects based on these social returns. Depending on the terms outlined in the Neighbourhood Partnership Agreement, communities too can benefit from either a share of the profits of a development (where new development is granted through a Neighbourhood Development Order) and use this to fund other local projects such as a community farm or a sustainable energy project - or they could negotiate community use or management of an asset, or a project add-on such as a community-run cafe. 21 Be Birmingham (2010) Public expenditure and investment study: Stage 1 – mapping report [Online] Available at: http://www.bebirmingham.org.uk/documents/EKOS_Summary_ Interactive.pdf [Accessed 3 April 2012]. 22 Department for Communities and Local Government (2011) 14 areas get 2012 starter gun to ‘pool and save’ billions [Online] (Updated 21 December 2011) Available at: http://www. communities.gov.uk/news/corporate/2056442 [Accessed 14 April 2012].
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If there was a potential for demonstrable financial benefit from the blended investment, residents would be given a real equity stake in the project at hand, by apportioning a percentage of the investment required to a designated formal community vehicle, such as a development trust, Community Interest Company, or an Industrial and Provident Society. This would be a separate and more formal business structure from the Neighbourhood Forum, but would serve to solidify its aims and channel economic gains over the long-term, beyond the plan-making process itself. The vehicle could in turn issue a community share offer in order to engage a wider catchment of residents in the ‘social contract’. Should there be long-term returns for large scale projects, or significant uplift in value, Neighbourhood Bonds could also be used to raise upfront finance while guaranteeing that the initial investment will be returned to the depositors. The models outlined above are just a few examples of how appreciating and formalising the partnership potential and social value gains from a neighbourhood plan could be channelled into a wide variety of blended investment models which move onward from more traditional – and limited – forms of funding. The Neighbourhood Partnership Agreement would serve as the basis for a pledge from a variety of potential stakeholders, including developers, local businesses, public services and land owners, feeding in multiple investments that drive for a common social cause. Depending on the nature of the project, the particular locality concerned, and the potential stakeholders, stakes apportioned would be variable and negotiable between the community-led vehicle and additional partners. Government should look to support and encourage these new and innovative sources of funding that are possible, have precedent and are community-led.
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On the horizon: Taking Neighbourhood Planning to the next level
Whilst there will still be a need for strong leadership in planning at the strategic level, if undertaken in the right way, neighbourhood planning could be a powerful, galvanising force within the planning system . It draws upon what is valuable and tangible to people, and can achieve demonstrable social and economic impact. Neighbourhood Forums have the potential to be not only grass-roots vehicles which impart greater local democracy, but the starting point for community-owned enterprises which give residents a financial stake in community-led projects. They could also provide a platform for more robust forms of local control and community empowerment, amplifying the Community Right to Bid by producing organised community structures capable of asset ownership and management. Below, we outline two ways in which the localism agenda could be taken to the next level, to build upon the proposals set out in paper: A Community Right to General Assets - In achieving more robust forms of neighbourhood governance, communities could emulate the success of Community Land Trusts - non-profit, community-based organisations run by volunteers providing housing at affordable levels - or locally controlled and accountable Development Trusts. Neighbourhood Forums could provide the platform for the expansion of community equity via a ‘Community Right to General Assets’, for example. This could be the starting point for a new set of expectations about the percentage share of equity by a community for each individual locality, based on what is valued as a priority in each neighbourhood. A Community Right to Invest in Real Estate - One has to be realistic about the limits of the currently proposed asset transfer programme. Currently, communities can acquire land and some selected assets through purchase or gift. Still, by large, communities are excluded from the main channels of investment in real estate. Main providers of funding for big developments in the UK are pension funds and insurance companies. Currently, the government is seeking to attract more private investment into the housing sector by looking into how the Real Estate Investment Trust (REITs) structures could be applied to social housing,23 but no thought has been given to how the real estate market could be opened up to all communities where development is planned. In time therefore, Neighbourhood Partnership Agreements could cement the need for methods which facilitate systematic investment from communities into real estate.
23 HM Treasury (2012) Real Estate Investment Trust (REIT) consultation as announced in Budget 2012 [Online] (Updated 4 April 2012) Available at: http://www.hm-treasury.gov.uk/consult_ real_estate_investment_trust.htm [Accessed 14 April 2012].
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6 Conclusion Neighbourhood planning is only in its infancy, but has already aroused considerable interest. Policy makers, professionals and an increasing number of communities are keeping a close eye on those pioneering the process, eager to see how the system develops and better understand the potential it has to not only transform places but to change the environment within which planning takes place. It is too early to make firm conclusions on the impact of neighbourhood planning or the appetite of communities to develop a plan in the first place. However, this should not stop us from exploring its potential. Although the legislation has come into force and the second wave of neighbourhood planning front-runners are beginning to put it into action, we must not think that the job is done. We should be thinking about how communities can be best supported to make real the ambitions set out by the government and how we can ensure the new system helps deliver the best places for people to live. A meaningful community-led planning process should foster genuine collaboration between all those with a stake in that community. Through a genuine partnership between all those with a stake in an area, it can help catalyse new ideas and thinking, produce better design solutions and create a new, reciprocal relationship between professionals and local communities. However, this type of collaboration should also be recognised as a preventative action with genuine potential to cut public spending, through the capture of the social value both inherent to and generated by a better built environment and the collaborative process itself. In time and with the right mechanisms in place, this value could be measured, quantified and captured in order to leverage the funding needed to support the process. In a similar vein, the benefits of participative planning could in future be bundled up with other intervention programmes to offer an aggregated ‘total neighbourhood’ approach. This is a radically new way of thinking about the relationship between communities and planning. Using what is important and definitive to local residents as a basis for quality of place, civic participation and ownership structures could start to cement interest in neighbourhood planning into tangible projects. To get this process moving, local people need to be given access to the support and expertise that can enable them to fulfil their objectives, whilst partnerships also need to be accountable to those involved. ‘Neighbourhood Partnership Agreements’ will ensure that these priorities lead the agenda when communities embark on creating a shared vision for the future of their area and discuss the social value of planning proposals. If practised properly, neighbourhood planning could stimulate community investment by helping to harness neighbourhood social enterprise, ensuring that the dynamic of power in local economies is not skewed by private interest. Similarly, a meaningful community-led planning process could stimulate a greater sense of collective agency, ensuring that the dynamic of power in local communities is not skewed by those with the capacity to shout the loudest. Once the whole community is given a real stake in the process, new and exciting horizons may follow for ownership and investment vehicles, along with the recognition of new types of community rights that until now have only been vague ideals. Focused, deliberative, and collaborative partnerships will open these doors.
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7 Recommendations Capturing social value from neighbourhood planning • Meaningful community participation; linking the community to design and planning experts to facilitate neighbourhood planning has the potential to deliver positive social outcomes. Neighbourhood planning should be recognised in terms of its inherent social value and demonstrable social impact by policy makers at both national and local level. • The Department for Communities and Local Government should appoint an independent panel of experts to define the metrics and structures required to capture the social value created through the neighbourhood planning process. These should be tested through a front-runner pilot programme. In the longer-term, Government should explore how neighbourhood planning could be amenable to finance through Social Impact Bonds. • In order to capture previous best practice, the Department for Communities and Local Government should facilitate a network of local authorities that have used Community Budgets, to share experience and evidence. This evidence base should be used to create future economic indicators that can be used to monitor the social impact of neighbourhood planning as part of a ‘total neighbourhood’ approach. Mechanisms to ensure meaningful local partnerships • Government should make a ‘Neighbourhood Partnership Agreement’ a statutory requirement for each Neighbourhood Plan. This would recognise and articulate the potential local ‘social value’ gained through a partnership between residents, local businesses, developers, the professional design community and local authorities. • In addition to their statutory duties to support neighbourhood planning, local authorities should broker Neighbourhood Partnership Agreements through Neighbourhood Forums, involving residents, independent professional support and other relevant stakeholders, such as developers. • Developer collaboration in a Neighbourhood Partnership Agreement should be treated as a material consideration in the planning process. Funding neighbourhood planning • Government should clarify the proportion of the Community Infrastructure Levy that should be dedicated to community initiatives, either through guidance or by setting out a required minimum threshold. • Government should put in place the legal framework to introduce a ‘Neighbourhood Consultation Deposit’ paid up-front on committing to a Neighbourhood Partnership Agreement, as a prerequisite for the planning application process. This should be used to fund the collaboration process and independent support for Neighbourhood Forums. • Local authorities should encourage ways in which the Neighbourhood Partnership Agreement could develop and form more formal enterprise structures open to blended investment models. Local authorities could play a particular role in raising a community share offer. Extending Community Rights • The Department for Communities and Local Government should work with the Treasury to support and incentivise further innovative sources of funding for neighbourhood initiatives, such as Neighbourhood Bond mechanisms, Community Investment Tax Relief and regional lending from banks. • The Department for Communities and Local Government should set up a taskforce to consider the extension of community rights drawing on existing best practice. This should consider ways to incentivise local authorities to increase the percentage of community owned equity (a Community Right to General Assets) and allowing communities to capitalise on future gains of the property development sector (a Community Right to Invest in Real Estate). • HM Treasury should explore the potential for local communities to invest in local development projects through Real Estate Development Trusts (REITs) should be extended to consider how local communities could collectively invest in local development projects (a Community Right to Invest in Real Estate).
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Dr Patricia Kaszynska is a Senior Researcher at ResPublica. Prior to joining ResPublica, Patricia conducted research in higher education policy at the London School of Economics and Political Science and the University of the Arts London, and completed her PhD (DPhil) investigating the political significance of the aesthetic domain at the University of Oxford, where she also taught aesthetic theory. Besides the PhD she holds an MSt with Distinction from Oxford and a First Class Degree in Philosophy and Art History from University College London. James Parkinson is Policy Officer at the RIBA with a focus on planning policy and localism. He has overseen the RIBA guide to localism series; introducing neighbourhood planning and exploring community engagement, and is looking at effective participation tools. James was previously a Design Advisor within RDA Yorkshire Forward. Will Fox is Public Affairs Manager at the RIBA, leading on the Institute’s work with government and parliament and increasingly with local authorities. Will formerly worked as a consultant at FD Public Affairs. The authors would like to thank those who contributed in a significant way to this publication: Caroline MacFarland, ResPublica; Caroline Julian, ResPublica; Richard Bridge, Community Matters; Stephen Hill, C20 Future Planners; Steve McAdam, Fluid/Soundings; Toby Blume, Urban Forum; Indy Johar, ResPublica Associate/Research00; Julian Dobson, ResPublica Associate/Urban Pollinators; Hugh Rolo, Locality; Jess Steel, Locality; Chris Brown, Igloo; Hank Dittmar, The Prince’s Foundation; Phillip Blond, ResPublica; Daniela Puska, ResPublica. All opinions and any errors herein are ours and ours alone. Dr Patricia Kaszynska, James Parkinson and Will Fox, July 2012.
Models and Partnerships for Social Prosperity This publication is an output of ResPublica’s Models and Partnerships for Social Prosperity workstream, one of the three core workstreams of the ResPublica Trust. This workstream explores innovative models for service delivery and new partnerships between communities, businesses and the public sector can radically change social and economic outcomes. From creative solutions for localised social care and education delivery to the benefits of community-owned energy and community-run housing associations, this workstream cuts across all sectors of policy to re-imagine the terms of these outcomes and the resulting benefits. In 2012 this workstream will encompass our research into new models for private, public and third sector partnerships and delivery of public services, including innovative approaches to welfare, health and social care, education, social housing, employment and skills. Drawing on a number of recent legislative developments - most notably, the Localism Act, the Open Public Services White Paper and the Public Services (Social value) Bill - the importance of social value in commissioning and service delivery is fundamental to our work.
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